The Australian share market sank almost 1 per cent, widening last week’s decline of almost 2 per cent amid continued uncertainty surrounding next week’s US debt ceiling deadline. Despite a soft start to the session local stocks plunged in the afternoon as the US government stand-off took a toll on sentiment.
Trading volumes were relatively low due to the Labour Day public holiday in New South Wales, ACT, Queensland and South Australia. Yet any holiday vibes were wiped out in the afternoon for those traders getting involved with all sectors ending in the red, weighed down by miners, health and energy stocks.
Figures
The S&P/ASX 200 index sank 47 points today, ending the session at 5,161.
The value of trades was $2.4 billion on volume of 365 million shares at the close of trade.
The top three stocks by value were BHP Billiton Limited
(ASX:BHP), Commonwealth Bank of Australia
(ASX:CBA) and ANZ Banking Group
(ASX:ANZ).
On the futures market the SPI is 54 points lower.
Economic news
The World Bank has cut its expectations for China’s growth this year. According to the World Bank’s East Asia and Pacific Economic Update China GDP is forecast to come in at 7.5 per cent in 2013, down from 8.3 per cent forecast in April. The World Bank says “Developing East Asia is expanding at a slower pace as China shifts from an export-oriented economy and focuses on domestic demand”.
Australian construction has risen to a three-and-a-half-year on the back of a recovery in the housing sector. The Australian Industry Group and Housing Industry Association Performance of Construction Index (PCI) added 3.9 points to 47.6 in September but remained below 50 which indicates the sector still sits in contraction territory.
Company news Commonwealth Bank of Australia’s
(ASX:CBA) broking arm CommSec has increased its annual profit by more than 9 per cent to $86 million. Australia’s largest online broking firm was aided by improving market conditions which lured more traders to its platform - servicing 1.9 million client accounts over the year. Shares in Commonwealth Bank of Australia dropped 1.41 per cent today, finishing the session at $70.75.
In the face of ongoing corruption claims Leighton Holdings Limited
(ASX:LEI) has lashed out at what it describes as “inaccuracies contained in media articles.” The construction company’s stock was beaten down last week amid claims of multi-million dollar cover-ups allegedly performed by past executives and directors. Leighton has told the market today it “takes exception” to criticism of its governance structures and condemns corrupt and fraudulent behaviour. Shares in Leighton Holdings recovered 2.87 per cent today, finishing the session at $17.22.
Shares in Fairfax Media Limited
(ASX:FXJ) ended steady amid media speculation the media company is considering a potential merger of its radio assets with Macquarie Radio Network.
Shares in Djerriwarrh Investments Limited
(ASX:DJW) lifted 0.23 per cent after the investment company announced its long standing Chairman Bruce Teele will step down and be replaced by Deputy Chairman John Paterson.
Shares in Warrnambool Cheese & Butter Factory Co.
(ASX:WCB) firmed 0.94 per cent after the takeover target affirmed its confidence in delivering earnings of between $47 million to $52 million over the 2014 financial year.
Shares in Xstate Resources Limited
(ASX:XST) surged 42.86 per cent today. The Mediterranean focussed oil and gas explorer was not aware of the reason behind the price spike but noted an article published last week in which Managing Director Andrew McRae said the company is “undervalued from a project/valuation viewpoint”.
Best and worst performers
All sectors finished in negative territory: The sector with the smallest losses was real estate investment trusts losing 1.4 points to close at 1,028. The worst performing sector was health care, falling 131 points to close at 13,576 points.
The best performing stock in the S&PASX 200 was Alacer Gold Corp
(ASX:AQG), rising 3.62 per cent to close at $3.15. Shares in Paladin Energy Limited
(ASX:PDN) and Leighton Holdings Limited
(ASX:LEI) also closed higher.
The worst performing stock was Linc Energy Limited
(ASX:LNC), dropping 6.75 per cent to close at $1.18. Shares in Medusa Mining Limited
(ASX:MML) and Independence Group NL
(ASX:IGO) also closed lower.
Commodities
Gold is trading at $US1,315 an ounce.
Light crude is $0.53 higher at $US103.84 a barrel.
The Australian dollar
The Australian dollar is buying 94.25 US cents.
